Levin Report

Trump Rides to “Murderous” Wall Street’s Rescue

“Was the tax cut big enough? Do you want more money? Just say the word.”

By Chip Somodevilla/Getty Images.

As a candidate, Donald Trump sent mixed signals on where he stood when it came to Wall Street. Though the former real-estate mogul initially called for Dodd-Frank to be “torn up” and said that he “disagreed” with calls to break up big banks, in a later campaign speech he told voters, “I know Wall Street. I know the people on Wall Street . . . I’m not going to let Wall Street get away with murder.” So far, the president seems to be proceeding with his former inclinations, easing up on financial penalties, appointing an acting Consumer Financial Protection Bureau director who doesn’t believe the agency should exist, and generally taking a kinder, gentler approach to policing the industry, which the president recently cast as a victim of overzealous regulation. And that’s not all! Thanks to his giant corporate tax cut, Trump has effectively rescued banks from the scariest scenario of all: making less money.

As the country’s five biggest banks began to report fourth-quarter results this week, a foreboding pattern emerged: terrible trading results, with their collective slumps in fixed-income trading exceeded analysts’ expectations of a 22-percent drop. Goldman Sachs, for whom the situation is especially frightening given its historic reliance on trading as a moneymaking endeavor, posted its worst quarter in bond trading since 2008, with a 50 percent drop in revenue in that unit, and a 14 percent drop in equities trading, at a time when global stock markets are reaching new highs on a near-daily basis.

But whereas the situation would normally have set chief executives rocking back and forth in the fetal position, recent legislation has cushioned the blow. As Bloomberg notes, “The sweeping tax overhaul means billions of dollars in profit will materialize from thin air for the industry, allowing executives the luxury of planning to increase dividends and stock repurchases, invest more in technology, and even do some good by extending credit to low-income borrowers. That’s all taking away attention from what probably would’ve been the focus of analysts and investors: lousy trading results.” Thanks to the bill, which might as well be called “Your Financial Institution Is About to Amass More Money Than the U.S. Mint Can Physically Print” Act, banks are expected to increase profits by more than $10 billion annually. (That’s on top of the record profits they’ve been enjoying, no thanks to cripplingly unfair regulation and suffocatingly high corporate tax rates.)

It’s not the only way in which Trump’s tax cuts have papered over certain weaknesses in the market. Last month, the White House got some good P.R. when AT&T and NBCUniversal said they would hand out $1,000 bonuses to staff. A handful of other major corporations made similar announcements—a positive sign, on the surface, after years of stagnant wage growth. But beyond the immediate optics, the economic divide is as wide as ever, and getting worse—a fact that Bank of America C.E.O. Brian Moynihan made painfully obvious on Wednesday. Following Citigroup’s announcement that it returned at least $60 billion to shareholders through dividends and stock buybacks, Moynihan said that the bank’s shareholders can look forward to “the largest portion” of the tax-bill benefits. “We expect most of the benefits from tax reform to flow to the bottom line through dividends and share buybacks,” he added, in case that was unclear.

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Eric Trump: my father isn’t racist because he only cares about money

What is the meaning of life? What happens after we die? Who is the dumber of Trump’s adult sons? Such are the questions that have long plagued philosophers and laymen alike. The answer to the latter question, for a time, appeared to be Eric, but for the past eight months, Donald Jr. has put in overtime to claim that title, from twice (!) telling Virginians to get out and vote the day after election day to thinking it was no big deal to meet with a Russian lawyer, to liking a tweet that discredited one of Roy Moore’s accusers on the basis that she’d been divorced three times and filed for bankruptcy just as many, an irony that was apparently lost on young Donny. But on Wednesday, the younger Trump son made his bid for a comeback.

Defending his father against accusations of racism, Eric toldFox & Friends, “My father sees one color: green. That’s all he cares about . . . He cares about the economy, right? He does not see race. He’s the least racist person I have ever met in my entire life.” Black, white, purple, yellow? As long as you’re making Papa Trump money, he doesn’t care what you look like, unless you happened to hail from some “s---hole” country somewhere.

Wine crime!

Goldman Sachs co-president David Solomon has reportedly been violated in one of the worst possible ways:

David Solomon’s personal assistant has been charged with stealing more than $1.2 million of rare wine from his boss. Nicolas De-Meyer was named in an indictment unsealed Wednesday in Manhattan federal court. The indictment says De-Meyer worked for an “individual who collects rare and expensive wine,” without naming the person. The individual is Solomon, according to a person familiar with the matter.

The theft included seven bottles from the French estate Domaine de la Romanée-Conti, widely considered “among the best, most expensive and rarest wines in the world,” according to the indictment. Solomon has a 1,000-bottle wine storage area in his Manhattan residence, according to The Real Deal. In all, De-Meyer stole hundreds of bottles, prosecutors said...De-Meyer is represented by a public defender, whose office didn’t immediately respond to a call seeking comment.

Among the wines allegedly pilfered by De-Meyer, who used the alias “Mark Miller” when selling the bottles to a North Carolina dealer, were seven bottles of Burgundy that set Solomon back $133,650, or roughly $20,000 apiece.

Andrew Cuomo has a plan

You limit his SALT deductions, he comes back at you with the fury of 1,000 angry New Yorkers on an A train stalled because of “signal issues”:

New York state would end income taxes on wage earners and make up the revenue with an employer payroll tax that’s federally deductible as part of a restructuring plan that Governor Andrew Cuomo is recommending to mitigate harmful effects of the new U.S. tax code. . . . By doing so, the tax burden would shift from workers—who face new limits on their ability to deduct state income taxes—to employers, who could still take full deductions for such payroll taxes. The legislation would spell out which kinds of companies would be eligible for this treatment.

“We’re doing everything we can to thwart the effects of the federal plan,” Cuomo said Tuesday, calling the tax bill “an economic missile” aimed at New York. “This is going to be the most difficult challenge that we’ve had to take on because it’s the most complicated, but I have no doubt that this is the fight of New York’s future.”